Halliburton Must Pay $200 Million For Defective Bolts

An arbitration ruling against Halliburton will require the Houston oil services company to pay $200 million to settle a claim it used defective bolts in a Brazilian offshore oil project.

The claim relates to a contract former Halliburton subsidiary KBR Inc. had with Barracuda & Caratinga Leasing Company to develop oil fields nearly a hundred miles off the Brazilian coast. Barracuda & Caratinga later found that certain subsea bolts used in the project were defective. The arbitration panel recently ruled KBR is liable for the cost of replacing the bolts.

Halliburton says it’s pursuing all possible avenues to appeal the ruling.

When it spun off KBR in 2007, Halliburton agreed to pay all the costs and expenses, cash settlements or cash arbitration awards related to the replacement of the bolts. The company says it expects to record a third-quarter charge to discontinued operations as a result of the arbitration award.

Bio photo of Andrew Schneider

Andrew Schneider

Business Reporter

Andrew Schneider joined KUHF in January 2011, after more than a decade as a print reporter for The Kiplinger Letter...